Rush Enterprises, Inc. (NASDAQ:RUSHA) Q1 2023 Earnings Conference Call April 26, 2023 10:00 AM ET

Company Participants

Marvin Rush - Chairman, Chief Executive Officer & President

Steve Keller - Chief Financial Officer

Conference Call Participants

Justin Long - Stephens

Andrew Obin - Bank of America

Marvin Rush

And welcome to our first quarter 2023 earnings release conference call. On the call are Mike McRoberts, Chief Operating Officer; Steve Keller, Chief Financial Officer; Jay Hazelwood, Vice President and Controller; and Michael Goldstone, Senior Vice President, General Counsel and Corporate Secretary.

Now, Steve will say a few words regarding forward-looking statements.

Steve Keller

Certain statements we will make today are considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Because these statements include risks and uncertainties, our actual results may differ materially from those expressed or implied by such forward-looking statements. Important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to those discussed in our annual report on Form 10-K for the year ended December 31, 2022 and in our other filings with the Securities and Exchange Commission.

Marvin Rush

As indicated in our news release, we achieved first quarter revenues of $1.9 billion and net income of $90.5 million or $1.60 per diluted share. We are proud to declare a cash dividend of $0.21 per common share. In the first quarter, we experienced strong demand for new Class eight and Class four to seven trucks, largely due to limited new truck production over the past few years. There was a healthy widespread demand for aftermarket parts and services as well and we maintained our focus on strategic initiatives, support to large national fleets and operational excellence. We significantly outpaced the industry in medium-duty truck sales, as well as aftermarket sales and we are proud of our results in the first quarter.

In the aftermarket, our parts service and body shop revenues were $648 million, up 19.3% and our absorption ratio was 136.5%. In the first quarter, we experienced strong demand for parts and service for most of the customer segments we support. We continue to add service technicians to our workforce, notably mobile technicians, which supports our long-term strategy to expand our mobile presence across the country.

Looking ahead, we anticipate the rate of inflation to continue to slow and the parts revenue, growth will moderate throughout the year, when compared to our first quarter results. However, with our continued focus on long-term initiatives, including strategically expanding our workforce to support mobile service efforts and national accounts, we believe our after quarter -- aftermarket revenues will remain strong this year.